Pension: Pennsylvania Public School Employees’ Retirement System
Assets Managed: $49 Billion (Dec. 2012)
PE Assets Managed: $10.8 Billion (June 2012)
PE Allocation (Target): 22% (22%) (June 2012)
Chief Investment Officer: Alan Van Noord
Van Noord’s retirement is the latest in a string of changes at the top of the nation’s largest pension funds, following a wave of departures in 2011 and early 2012.
A spokeswoman for the pension, Evelyn Tatkovski, described a range of pension-fund achievements under Van Noord, including a more diversified asset allocation, a doubling of the allocation to private equity, the start of hedge fund and commodities programs and the reduction of the pension’s public-equity exposure.
In a statement, Van Noord said, “Deciding to retire is an extremely difficult decision to make, especially when you enjoy your job as much as I do…I am confident that I leave behind a strong investment structure better able to withstand any difficult economic times in coming years.”
Van Noord joined Pennsylvania PSERS in 2002 after having spent 27 years at the $47 billion State of Michigan Retirement System—the last five as chief investment officer.
The $49 billion retirement system has one of the nation’s highest allocations to private equity and alternatives, with 22 percent, or $10.8 billion, of the portfolio invested in buyouts, venture and private debt as of June 2012. The lion’s share of that—16.6 percent or $8.1 billion—is in buyouts. Altogether, investments in private markets exactly match the pension’s 22 percent target allocation to alternatives. The allocation to alternatives before Van Noord joined Pennsylvania PSERS was less than 10 percent.
Other investments often considered “alternatives,” such as hedge funds and commodities, make up another 17 percent of the portfolio, making PSERS a very big player in the alternatives space.
Pennsylvania PSERS manages the retirement assets of 475,000 current and future state teachers.